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British Airways has dropped strong hints that it may end services to Australia after it was spurned by long-time alliance partner Qantas in favour of Emirates.
In a submission to the ACCC, BA said the 17-year revenue sharing alliance, set to end in March, has been a vital part of its Australia services, allowing it to make more efficient use of aircraft and gain access to the lucrative Australian corporate market.
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”BA considers that it is increasingly challenging for an international airline to operate services on long-haul routes between the United Kingdom-Europe and Australia in the absence of such an alliance, due to persistent excess capacity and the nature of the substantial fixed costs involved in their operation,” the airline said in its submission.
In a separate news release, BA struck a much different note, saying its daily London-Sydney flights would continue as usual, building on a 77 year tradition of service to Australia.
“British Airways is very proud of its long history with Australia and we remain committed to providing customers with the best of British service when travelling to the UK and Europe,” Neil Ager, BA’s Regional Commercial Manager, said in a statement.
BA and Qantas both remain members of the oneworld alliance and BA said it hoped to continue code sharing services in Asia and Europe after the bilateral agreement ends on March 31.
Under its proposed alliance with Emirates, announced in September, Qantas will switch the transit point for its London flights from Singapore to Dubai. Qantas has also canceled code sharing deals with Air France and Cathay Pacific.
The ACCC is expected to issue a draft ruling on the alliance by the end of the year.
Virgin Australia, which has an alliance of its own with Emirates-rival Etihad, has raised concerns about the Qantas deal, saying it would entrench Qantas’ dominance in the Australian market and questioning claims the tie-up would lead to lower fares.
